NielsenIQ (NIQ) has released its ‘Mid-Year Consumer Outlook: Guide to 2025’ report, identifying macro catalysts across industries. The study found consumers remain determined and resilient despite the uncertainty, providing a strategic roadmap for retailers looking to win over consumers over the next 12–18 months and beyond.
The report anticipates that global consumers will spend $3.2trn more in 2025, representing nearly 6% growth compared with 2024, according to World Data Lab.
With the global economy facing ongoing and unprecedented challenges, NIQ’s semi-annual study offers a comprehensive analysis of the impact of events and trends on consumer confidence, changes in consumer attitudes, and insights into the factors influencing purchasing decisions.
With looming uncertainty around geopolitical crises, economic stability, and environmental health, NIQ found that consumers are becoming resilient and are spending where it matters most. This shows a determined shift from cautious to intentional consumption, with a focus on a sense of prosperity and well-being.
“There is increasing demand for AI-driven insights based on large quantities of granular data that only NIQ can deliver,” said Tracey Massey, COO of NIQ. “Having your finger on the pulse of current and expected consumer behaviour that is benchmarked globally is now table stakes to establish and maintain any competitive advantage.”
Global catalysts to change in 2025:
- Readiness for AI: 40% of consumers would accept a product recommendation from their AI assistant, and 40% would leverage AI to automate and speed up their everyday shopping decisions, making it essential for companies to assess which AI advancements are going to appeal to consumers and provide options to support older consumers.
- The rise and impact of GLP-1 drugs: 31% of global consumers are likely to use a medication or drug to support weight loss, but GLP-1 medications will drive a wide scope of impact by inspiring new spending sources, influencing consumer lifestyles, and shaping norms of interpersonal behaviour.
- Omnichannel evolution: The social commerce revolution has led to the evolution of omni, with an 11.6% increase in global online sales performance and the rise of gamification, with 36% of consumers saying they would spend more on a purchase because of an in-app experience.
- Hot commodity costs: 60% of respondents said they will buy fewer snacks and confectionery products if prices continue to increase or remain high for the next three months – the highest ‘dropout’ response across all surveyed categories. Cocoa (+128%), Coffee (+43%), and Milk (+44%) are “hot commodities,” according to measures by Trading Economics, with rising prices impacting volume sales of related categories/products.
Top trends framing expected 2025 spending:
- Consumers’ top concerns remain rising food prices (33%), followed by increasing utilities costs (20%), and the threat of an economic downturn (19%). Climate change is fourth (14%), owing to the numerous extreme weather events around the world.
- A majority (67%) of surveyed consumers around the globe said they are likely to change or try a new brand because of lower pricing.
- They intend to continue cutting back on non-essentials like Out-of-Home (OOH) Dining (38%), Out-of-Home Entertainment (37%), and Food Delivery/Takeaways (36%). Expect to see decreased spend on OOH activities, while intentional choices around In-Home Entertainment (48%) and spending on Socialising/Gatherings (46%) are likely to be maintained in 2025.
- Meanwhile, private-label product interest continues to rise, with 50% of consumers buying more private-label products than ever. What’s more, 40% of global consumers say they would switch to a private-label product they enjoy, even if it costs more.
- North American consumers worry most about rising housing costs, while global conflict is a top concern for Africa, Middle East, and Europe.
- The pace of monthly consumer packaged goods (CPG) inflation continues to slow across countries, down to less than 2% growth YoY. Regionally, CPG inflation is also trending down, but it remains higher than average in Latin America and Africa. Monthly global prices have risen fastest in Latin America, which has seen as much as 9% YOY growth.
- Upselling opportunities: Intentional consumers are willing to pay a premium for worthwhile attributes. In Tech & Durables, unit sales of premium-priced smart / mobile phones are up 17% in 2023 vs. 2019, compared with economy options, which are down 32% in the same period.
“Over the past six months, there has been a determined shift from cautious to intentional consumption habits. Consumers are willing to spend more but remain conscious of potential changes,” said Lauren Fernandes, VP Global Thought Leadership, NIQ.
“Consumers are seeking value with every purchase in multiple ways. They are spreading their spending very purposefully – and expect to leverage any excess in strategic ways in 2025 and beyond.”
NAM Implications:
- ‘consumers remain determined and resilient despite the uncertainty’
- …but are spending carefully, very carefully.
- These NIQ Global catalysts to change in 2025 are worth using as a lens re your business.
- Consumers will continue to seek value and switch to own-label (at what recovery cost?)
- Meanwhile, the past five years of Lockdown fallout have made surviving consumers extra savvy…
- …unwilling to settle for anything less than demonstrable value for money.
